Crude oil prices moved higher…
Uncertainty caused by the transition…
Iran’s crude oil exports to China could hit an 11-month high this month, according to sources who spoke to Reuters. But overall, Iran’s total oil and condensate exports for the month could fall by 4 percent on an annual basis to 2.37 million barrels daily.
In July, according to TankerTrackers, Iran exported an average 605,699 bpd to China, with its market share standing at 26.82 percent. Overall exports averaged 2.26 million bpd. Energy data provider Kpler calculated the average daily crude exports for July at 2.476 million bpd.
Iranian crude has become more attractive for buyers looking for a bargain after Tehran lowered prices, and with heavy crude supply from South American falling. A supporting factor for this higher attractiveness was the decline of the Dubai regional oil benchmark against Brent crude.
Be that as it may, one source told Reuters that overall Iranian shipments to Asia this month might fall to 1.3 million barrels, chiefly due to tensions between Tehran and New Delhi regarding the development of the offshore Farzad-B gas field, which Indian ONGC was negotiating for months, but Tehran chose to award it to Gazprom.
Yet the overall decline will be small, at just 0.3 percent from July. The decline in Indian exports, however, will be heftier, at 25 percent, to 310,000 bpd. As a result, the source added, South Korea will become Iran’s second-biggest client after China, importing 380,000 bpd this month.
In China, Iranian crude may continue to gain market share as production cuts in other OPEC members continue and supply from South America remains tight.
Iran plans to further increase its crude oil production by about 200,000 bpd by the end of this year, with the total climbing to 4 million barrels daily. So far, Iran has not offered to start cutting output in line with other OPEC producers, although it has declared its support for the deal.
By Irina Slav for Oilprice.com
More Top Reads From Oilprice.com:
Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.